Pharmacies that wish to receive or maintain accreditation under the Veterinary-Verified Internet Pharmacy Practice Sites (Vet-VIPPS) program run by the National Association of Boards of Pharmacy are now being asked to divulge their drug supply sources.

A barrage of complaints and questions about where Internet pharmacies obtain veterinary drugs has prompted an investigation by the National Association of Boards of Pharmacy (NABP).

The association is taking a look at how pharmacies acquire companion-animal prescription medications, according to NABP Executive Director Carmen Catizone.

While the association has no direct regulatory power over pharmacies, it runs an accreditation program specifically for online pharmacies called Veterinary-Verified Internet Pharmacy Practice Site, or Vet-VIPPS. To achieve Vet-VIPPS accreditation, a pharmacy must demonstrate to the association that it is properly licensed and complies with state and federal laws and regulations — something a number of Web-based pharmacies fail to do.

Vet-VIPPS is modeled after a program called VIPPS established for online pharmacies that sell drugs for human patients. Though voluntary, the programs have significant influence with online advertising. Search engine giant Google requires online pharmacies in the United States wishing to purchase advertising to be accredited by the NABP.

When Vet-VIPPS was established in 2009, applicants were not specifically required to disclose to the association its sources of medications, Catizone said. Now they are. “We ask for sample invoices and randomly select and look at them,” he told the VIN News Service.

In addition, the association is “holding up” accreditation of pharmacies about which they’ve received complaints while its investigators attempt to determine whether any laws are being broken, Catizone said. He declined to identify which pharmacies are affected, saying disclosure at this juncture would be premature.

The association has found the supply question to be convoluted and confounding, he said: “Our heads are spinning here."

It's no wonder. Gray-market diversion, as the activity is called, is a complicated affair in the veterinary world. The situation is this:

Almost every veterinary pharmaceutical company has a sales policy that products are to be sold only through licensed veterinarians who treat patients.

Veterinarians accuse manufacturers of secretly selling products directly to outside pharmacies while trying to appear loyal to and supportive of veterinarians.

Some veterinarians take part in diverting drugs by ordering more than they need and selling the excess to brokers who supply the retailers. This practice, while not necessarily illegal, is considered by the veterinary profession as unethical.

Manufacturers’ role in diversion is murky. Some veterinarians who have diverted report instances of at least one leading pharmaceutical company facilitating diversion.

Catizone said the NABP began investigating the issue about six months ago after receiving a number of allegations by veterinarians that some Vet-VIPPS pharmacies were illegally obtaining prescription drugs. The complaints and war of words has escalated since, he said.

“We’re getting calls every hour from veterinarians and veterinary pharmacies on this issue with conflicting reports and accusations,” Catizone said.

His sense is that “people are not following the rules on both sides of the equation.”

He said the association has found nothing in the law that prohibits a veterinary pharmaceutical company from shipping product directly to a pharmacy. Whether that is happening in spite of the companies’ official sales policies is something the group is trying to ascertain.

If the pharmacies are buying from sources other than the pharmaceutical companies — in other words, from the gray market — Catizone said, it’s unclear whether that’s a regulatory problem. The U.S. Food and Drug Administration (FDA) has not provided guidance, he said: “We cannot get a solid answer from the FDA or anyone to say what is OK, what is an authorized channel, what’s acceptable and what’s illegal.”

Complicating matters further is the possibility that regulators could consider veterinarian-exclusive sales policies a violation of antitrust laws, Catizone said. Executives with the veterinary pharmaceutical company Merial have told the VIN News Service in the past that they must take care not to police their sales channels so vigorously that they draw accusations of anti-competitive activities.

In terms of professional pharmacy standards, Catizone said a chief concern regarding diverted drugs is whether they are authentic products that have been safely handled. Medications from unauthorized, undocumented sources are considered to have a higher risk of being counterfeit, diluted or otherwise adulterated.

“Without that chain of custody and that pedigree, knowing it came along a valid source, they’re really playing Russian roulette with patients’ lives,” Catizone said.

He’s concerned that patient welfare, which should be foremost, is being pushed to the sidelines in a tug-of-war over who should control, participate and profit from the sales of prescription drugs.

“The idea here is to have a proper diagnosis, a valid prescription, and the patient receives the right prescription and there’s no question about the integrity of the medication,” Catizone said. “.... If we lose sight of the patient and focus on the money, then we’re going down the wrong path.”

Currently, 18 online pharmacies are accredited as Vet-VIPPS. Among them is PetMed Express, Inc., which bills itself as “America’s Largest Pet Pharmacy.” The company states in its annual report that it purchases product from secondary sources because of manufacturers’ refusal to sell to the pharmacy.

Asked about the potential impact of the NABP’s attention to supply sources, PetMed Express Chief Financial Officer Bruce Rosenbloom said he was not familiar with the inquiry. “We don’t have any issues with our certification, if that’s what you mean,” Rosenbloom said. “We’ve gotten our certification, and we’ve followed all rules and regulations.”

PetMed Express’s Vet-VIPPS listing shows it was accredited on March 3, 2010, and will be up for renewal in 2013.

Executives of two other Vet-VIPPS pharmacies interviewed by the VIN News Service said they welcomed the NABP’s scrutiny of diversion.

Wes Hepker, manager of VetRx Direct, the first pharmacy to achieve Vet-VIPPS accreditation in 2009, said his company deliberately has chosen not to purchase drugs from unauthorized suppliers. “Who’s to say those didn’t sit out in the sun, out of a controlled environment?” Hepker said. “We can’t give customers our 100 percent confidence these drugs are safe.”

As a consequence of its decision not to tap alternative markets, Hepker said, VetRx Direct has gaps in its inventory.

The pharmacy does carry some products manufactured by companies that have veterinarian-exclusive sales policies. Asked how it obtains those drugs, Hepker demurred. “A lot of that information is proprietary information for us,” he said. “I know that sounds like a cop-out. But because of the competitive landscape, we don’t discuss specifically where we get our drugs, except they are United States-licensed wholesale distributors.”

Hepker said his company favors the NABP asking accreditation applicants about their drug suppliers, and that VetRx Direct did discuss its suppliers with the NABP during its original accreditation review.

VetSource, another Vet-VIPPS pharmacy, is able to obtain its medications directly from manufacturers owing to its role as a “central fill” pharmacy, said company president and CEO Kurt Green. The pharmacy is contracted by veterinarians to fill their prescriptions, in essence serving as an extension of those clinics.

“The manufacturers understand our model, and we buy directly from the manufacturers,” Green said. “We had to demonstrate (to them) what the concept of the central fill approach was — the fact that we’re veterinarian-sponsored and supporting the veterinarian in this process.”

Of the 18 Vet-VIPPS pharmacies, Green said he suspects only a few obtain all of their products from authorized sources, while the rest rely on diversion to obtain some portion, if not most, of their products.

During his company's Vet-VIPPS certification process, Green said he suggested to the NABP reviewer that the program consider requiring applicants to prove they acquire products only from authorized channels. He was pleased this week to learn that the organization is checking supply sources now.

Dinah Jordan, chief of pharmacy services and a clinical professor at Mississippi State University College of Veterinary Medicine, said she believes the NABP’s decision to investigate diversion will raise the credibility of Vet-VIPPS within the veterinary community.

“I know there’s been concern about the Vet-VIPPS program because of this very thing: Where are (the accredited pharmacies) getting their drugs?” she said. “If you’re going to have a Veterinary-VIPPS standard of approval, then certainly the stamp should reflect not only the legal but also the ethical standards of the profession.”